BILL ANALYSIS                                                                                                                                                                                                    






    SENATE COMMITTEE ON AGRICULTURE AND WATER RESOURCES
                    Jim Costa, Chairman

SB 554  (Kelley)
As Amended March 25, 1999
Hearing Date: April 20, 1999
Fiscal: Yes
Consultant: Dan Webb

PURPOSE OF BILL: 

To grant one project-specific exemption to a general requirement  
that flood management projects must first be authorized by the  
state prior to similar approval by Congress.


BACKGROUND:

Traditionally the federal government has paid a minimum of 50%  
to a maximum of 75%, based on a specified formula, of total  
costs for flood management projects authorized by Congress and a  
State Legislature.  The federal Water Resources Development Act  
of 1996 (WRDA) authorized numerous projects throughout the U.S.  
using the above-described formula, but reduced federal  
participation in subsequent projects to a maximum of 65% of  
total costs.

State participation in flood management projects can either  
occur through sponsorship of the State Reclamation Board (if the  
project is in the Central Valley), or the state flood  
subventions program.  California law allows state contributions  
of up to 70% of the non-federal costs, with the remainder to be  
funded by the local sponsor.  State law also authorizes payment  
of 50% of the nonfederal capital costs of the recreation and  
fish and wildlife enhancement features of a project, if  
specifically authorized by the Legislature.

The Appropriations suspense process has traditionally been used  
to determine priorities between various projects competing for  
funding.  The state pays flood management subventions from the  
General Fund, the Special Account for Capital Outlay, or  
sometimes via bond measures.  These programs have been severely  
underfunded since 1990.  Proposition 204 paid down the  
outstanding balance by $60 million, but unpaid amounts owed to  
local governments are estimated to reach $189 million by years'  
end.  










One of last year's budget trailer bills (AB 2784, Strom-Martin)  
included a requirement that future flood management projects  
must first be authorized at the state level before seeking  
similar approval by Congress.  This requirement does not apply  
to small projects, efforts sponsored at the state level by the  
Reclamation Board, and those federally funded by agencies other  
than the U.S. Army Corps of Engineers.




PROPOSED LAW:

This bill would grant one project-specific exemption to a new  
general requirement that flood management projects must first be  
authorized by the state prior to similar approval by Congress.   
The affected project is located in the Whitewater River Basin in  
Riverside County.  As currently drafted, the bill creates this  
exception, but does not provide for state adoption and  
authorization of the project.


COMMENTS:

The need for this bill comes as a result of timing:  the  
sponsors say their project's Corps of Engineers Report will  
likely be published in October of this year.  Language nestled  
in one of last year's budget trailer bills requires new projects  
to be authorized at the state level before such a report is  
complete.  Options available to the sponsor in seeking state  
support are to (1) Run an urgency bill in the hope of passage  
before the report's publish date; or, (2) Delay the report, at  
risk of missing the opportunity to take part in the federal  
authorization process that occurs only once every other year;  
or, (3) Seek an exemption to the new "state first" authorization  
requirement (hence this bill).

Senate Bill 854 (Costa) was recently amended to delete the  
hastily imposed "state-first" flood project authorization  
requirement placed in one of last year's budget trailer bills.   
Its intent is to replace state primacy language with that  
developed through a collaborative process between stakeholders,  
the administration, and affected policy and fiscal committees.   
In the interim, a vehicle such as SB 554 may be necessary to  
grant specific exemptions for projects facing loss of  









congressional funding in the current year.

The author may wish to add state adoption and authorization  
language to the bill, as this will be a necessary additional  
step in securing any state participation in the project.   
However, doing so would change the bill to a two-thirds vote  
requirement, and would increase the likelihood of the measure  
being held with similar bills in Appropriations while criteria  
are developed to guide fiscal policy in these matters.


SUPPORT:

Coachella Valley Water District (sponsor)


OPPOSED:

None Received